Key Points :
- Mistry said housing and real estate sector is the biggest employer in the economy after agriculture, and that 80 per cent of the workforce in the sector require minimal skills.
- He also sought priority support for the manufacturing sectors.
- Talking about the repayment issues in the housing and the real estate sector, Mistry said that he expected non-performing loans to be in single digits.
Mortgage lender HDFC Ltd’s CEO Keki Mistry on Saturday said the “worst is behind us” and the economic recovery proudly has been faster than expected.
Mistry said that the Indian economy has shown its resiliency as the December quarter growth could outperform the expansion logged in the corresponding quarter a year ago.
The Benign interest rate schedule will continue going forward and that rates will rise up only after economic activity gathers more pace and inflation pressure rises, Mistry, vice chairman and CEO, HDFC Ltd, said at an online dialogue organised by the All India Management Association (AIMA).
He also however, said that interest rates have bottomed out.
AIMA said in a release quoting him,
The government should identify the job creating sectors and address their issues on priority.
Keki Mistry also mentioned the housing and real estate sector which is the biggest employer in the economy after agriculture, and that 80 per cent of the workforce in the sector require minimal skills.
He also has completely sought priority support for the manufacturing sectors.
Talking about the repayment issues in the housing and the real estate sector, Mistry said that he expected non-performing loans to be in single digits.
The non-performing individual loans could be in the range of 2.5-4 per cent, which is also the extent of loans that the RBI has allowed to restructure, Mistry added.
Talking about the economic condition, Mistry said the Indian economy had proved to be resilient.
“The worst is behind us and the recovery has been faster than expected. By the end of December, the economy would be at the pre-COVID levels for most sectors. The December quarter growth could be better than the growth in the December quarter last year,” he said.
However, Mistry optimistically said that a lot depended on whether another virus wave hits in the winter. Still, he said, the government was aware that India could not afford another lockdown.
He also added,
Consumption being 60 per cent of the Indian economy, the recovery and growth efforts have to be led by boosting consumption.
“The cost of lowering taxes would not be too high whereas the benefits from higher consumption would far outweigh the revenue loss to the government. While the corporate tax rates had gone down, the peak rate for individual tax rate had gone up from 35 per cent to 44 percent,” is also what Mistry specifically said.
Among others, Harsh Pati Singhania, President AIMA and Vice Chairman and Managing Director, JK Paper Ltd, said that interest rates could still be lowered a little to stimulate the economy.
“The government needs to be bold at this point of time. Economic theory is one thing, but we need things to happen on the ground right now,” he said.
Kirloskar Brothers Chairman and Managing Director Sanjay Kirloskar have also added to the statements above that said –
The economy was slowing down even before COVID-19 and the September performance of many sectors was better than that in the same month last year, the release said.
